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Loren, Attorney
Category: Business Law
Satisfied Customers: 28555
Experience:  30 years experience representing clients .
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I need to fire a partner (50%) in my business (S Corp). Im

Resolved Question:

I need to fire a partner (50%) in my business (S Corp). I'm the CEO and President (50%) and have final authority on all business decisions. My question is can I fire him?
Submitted: 7 years ago.
Category: Business Law
Expert:  Loren replied 7 years ago.
Assuming the by-laws provide you such authority, you can terminate your partner as an employee, if he is so utilized. That does not, however, eliminate him as a 50% shareholder in the corporation.

To do that you will either need to look to the terms of your shareholder agreement, if one exists, negotiate a buyout of his interest or sue him to have a judge value the assets and work out a buyout and dissolution.

Good luck. I hope it turns out ok for you.
Customer: replied 7 years ago.
I not sure if we have that in the by laws, but the SBA forced us to sign and notorize a document that made me the the final authority on all business decisions (when we received SBA certification). I assume that this should be sufficient?
Expert:  Loren replied 7 years ago.
The SBA document is, I suspect, something along the lines of a Certificate of Incumbancy, which does not supercede the corporate oranizational documents.

You need to check your by-laws and/or shareholder agreement. Those documents will control your rights and obligations within the corporation before an SBA document whch may or may not grant any authority whatsoever as between the shareholders.

Good luck.
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